This is particularly true of Rosemarie Gariépy. When they bought their condo in March 2022, the teacher and her spouse were convinced they were getting a good deal. After paying “about $200,000” for this first property in Quebec, the young couple opted for a mortgage repayment with an adjustable rate, which was 1.5% at the time. “Everywhere we called to ask about our interest rate, everyone told us to take a variable interest rate,” the young woman recalls.

Similar situation for Maude Paquette-Boulva. When she bought her Pointe-Saint-Charles condo in June 2022, the 32-year-old designer also opted for a variable rate. As a self-employed person, she says she has “no major risk issues” but the rate hike still beat her forecast.

In anticipation of future increases, Maude Paquette-Boulva has increased her mortgage payments from $2,000 to $3,000 since purchasing her $420,000 property. Even if she manages to adapt to this increase, she feels that “it’s really too expensive, it doesn’t make sense”.

variable influence

The Bank of Canada’s announcement doesn’t necessarily shake all young buyers. If Dany Gosselin opted for a variable interest rate when buying his semi-detached house in May 2022, he should be able to refinance it without a penalty. “I saw it more as an investment,” he explains.

Since he intends to convert his property in Longueuil into a rental property, the increase in the official interest rate does not destabilize him too much. “In the long run, I’ll get my money anyway with the rising rents,” he says. Dany Gosselin believes the rate hike will further weaken first-time buyers, who are vulnerable to large investors “who are able to buy a block and put down a 60% deposit.”

“money in the trash”

Maude Paquette-Boulva and Rosemarie Gariépy do not regret becoming owners. However, the renewed interest rate hike promises to increase Rosemarie Gariépy’s monthly payments by more than 40% from their original amount. The young woman “didn’t expect” such an increase, even if she and her spouse could cope with it. “You really feel like you’re pitching Your money in the trash,” she laments.

“We all grew up with one generation of parents [qui disent] that buying is the best,” emphasizes Maude Paquette-Boulva. However, she believes that being an owner is “actually not that much of an advantage at the moment”. She advises those thinking about buying a home to think twice. “In hindsight, it still is Prettybeing a tenant,” she concludes.